Opening a corporate bank account in China

A business licence proves the company exists. It does not prove the company is a reasonable banking client. Chinese banks are required to apply customer due diligence under anti-money-laundering rules, and they carry the consequences if a client turns out to be a shell, a sanctions risk, or a front for money that cannot be explained.

That is why a small, newly registered company with a foreign shareholder and no trading history attracts more questions than its size suggests. The file has to answer them before they are asked: who the ultimate owners are, where the capital came from, what the company sells, who its customers are, and how the first payments will be documented.

• Corporate file — Business licence, articles of association, company chops and the legal representative’s identity document.

• Ownership and control — The full ownership chain to the ultimate beneficial owners, with passports or corporate documents for each layer, and the authorised signatories.

• Address evidence — The lease, the property certificate and utility or site photographs that show the company actually operates from the registered address.

• Business substance — Contracts, purchase orders, invoices, a business plan or a website: evidence of what the company will trade and with whom.

• Source of funds — Bank statements, sale agreements or corporate records showing where the capital and the first inflows come from.

• Tax and registration — Tax registration, the foreign-exchange registration for capital contribution, and social-insurance registration where staff are employed.

Documents in a foreign language usually need a Chinese translation. Names and addresses must match the registration file exactly; a mismatch between the passport name and the licence is a common cause of rework.

Two to six weeks is a realistic range after the licence and chops are ready, and some files take longer. Government fees are modest; the real cost is management time and the delay to payroll, tax payments and customer invoicing.

Applications are most often refused or stalled for reasons that are fixable in advance: a registered address that looks like a mailbox, a business scope that does not match the described activity, an ownership chain that ends in an unexplained holding company, a legal representative who cannot explain the business, missing source-of-funds evidence, or a sector the branch treats as high risk. Being turned down by one branch is not a permanent bar, but a second application should address the actual reason rather than repeat the same file.